March 26, 2010

State relations

House passes budget bills with no further cuts to higher education

The full House considered and passed all thirteen appropriations bills this week. The bills, sponsored by Rep. Allen Icet (R-Wildwood), will now move to the Senate.

A number of reductions were made to the various state departments. HB2003[1], the higher education appropriations bill, passed with the 5.2 percent reduction for flat tuition agreement intact. University-related items also retained the committee-recommended amounts, which included increases above the governor’s recommendations for the Missouri Kidney Program, Missouri Telehealth, University Hospitals and Clinics, and $2 million for a joint UMKC-Missouri State University pharmacy program. In addition, Rep. Don Ruzicka (R-Mt. Vernon) successfully passed an amendment to increase the appropriation to Missouri Rehabilitation Center by $400,000. The House passed the bill by a vote of 110 to 46.

In part, higher education institutions avoided reductions through an unrelated amendment by Rep. Maynard Wallace (R-Thornfield). Rep. Wallace offered an amendment to HB2002[2], the Department of Elementary and Secondary Education’s appropriations bill, which reduced the school foundation formula by $105 million. Rep. Wallace explained the reduction would reduce the formula to its Fiscal Year 2010 appropriations level, which would allow schools to plan their FY11 budgets in a similar manner to the current fiscal year. The amendment was adopted with a vote of 80 to 68. The amendment, as explained during an inquiry between Rep. Icet and Rep. Chris Kelly (D-Columbia), effectively “balanced” the House’s version of the budget. Its passage made it unnecessary for Rep. Icet to introduce a number of additional reduction amendments, including one that would have reduced higher education institutions’ appropriation by $14 million.

Senate working groups explore cost cutting options and efficiencies for state government

As the state prepares for a challenging budget environment for FY11 and FY12, senators took a break from normal activities March 23 to meet as four-member “working groups” to explore public and agency/department suggestions for ways to save money in eight categories of state government.

The “Rebooting State Government” initiative was developed by Senate President Pro-Tem Charlie Shields (R-St. Joseph) and was designed to take an unconventional approach to dealing with shrinking revenues. The Senate received hundreds of e-mail suggestions from citizens for ways the state could save money. These, as well as suggestions from departments and agencies, were reviewed. Additionally, UM System President Gary Forsee provided a list of suggestions to the working group on education topics, including examples of steps UM has taken to cut costs.

Each group developed five or six recommendations, and the ideas were presented to the full Senate. Recommendations that move forward will either be developed into amendments for existing legislation, incorporated into budget discussions as the FY11 budget bills are received in the Senate, or suggested to agency or department directors who may be able to make changes without legislative involvement.

University officials were interested in the session that reviewed education ideas. Most of the recommendations considered by the working group related to elementary and secondary education, but the group did suggest serious conversations about combining the Department of Elementary and Secondary Education with the Department of Higher Education. They also suggested higher education institutions explore additional ways to find shared services, prompted in part by efforts of UM officials to implement shared services.

Senate Education Committee approves Bright Flight legislation

A bill to clarify the distribution of Bright Flight merit-based awards when full funding is not appropriated was adopted 8 to 0 by the Senate Education Committee March 24. SB733[4], sponsored by Sen. David Pearce (R-Warrensburg), who is also chairman of the committee, clarifies that funding of the awards up to $3,000 for students who score in the top three percent on standardized tests is the top priority. Students who score in the fourth or fifth percentiles would be awarded up to $1,000 only if funds are available.

The allocations became an issue for the coming year when the Bright Flight program increased the amount of the award for students in the top three percent from $2,000 to $3,000 and eligibility was expanded to include students in the fourth and fifth percentiles. Lawmakers do not have sufficient funds to appropriate for full awards, and the Department of Higher Education had no clear guidelines for how to allocate a partial award. The changes, which were suggested by UM officials, help ensure that the original intent of the program—to keep the best and brightest students in Missouri—is upheld.

The bill also makes several other adjustments and clarifications in the Bright Flight program. It now awaits full Senate debate.

President Forsee has emphasized the importance of taking steps to increase the number of students enrolled in science, technology, engineering and math programs. A bill to establish such an initiative within the Department of Higher Education was adopted 8 to 0 by the Senate Education Committee March 24.

SB936[5], sponsored by Sen. David Pearce (R-Warrensburg), establishes a fund to help match private and institutional dollars allocated to enhance and expand programs designed to increase the number of students in these fields. The initiative established by the bill could be used to fund endowed teaching fellowships, financial aid and scholarship programs for students studying in the field, and pre-college camps to expose younger students to science, engineering and other fields.

Spinal Cord Injury Fund bill passes Senate

The Senate approved SB987[6], sponsored by Sen. Bill Stouffer (R-Napton), March 25. The bill would allow the Spinal Cord Injury Fund to increase the amount of its research awards. Current law allows the fund to award grants of $50,000 each, which has proven difficult, due to the high cost of spinal cord injury-related research. As a result, the funds remain underutilized. SB987 would increase the award amount to $250,000 in order to adequately support cutting-edge research. The bill now moves to the House, where it will be sponsored by Rep. Steve Hobbs (R-Mexico).

MU Extension offers workshop for legislative staff

MU Extension held a workshop at the Capitol March 25 to showcase databases and programs available through Extension to legislative staff to assist them with their office responsibilities. More than 20 legislative aides attended. Presenters included Mary Simon Leuci, assistant dean, community development; Bill Elder, director, Office of Social and Economic Data Analysis (OSEDA); and Chris Fulcher, co-director of the Center for Applied Research and Environmental Systems (CARES).

Elder discusses the upcoming census count and its impact on Missouri during the Extension workshop March 25.

Federal update

After a year-long debate, health care reform came to a conclusion as the House of Representatives adopted HR3590[7], the Patient Protection and Affordable Care Act of 2010. The legislation was passed March 21, with the chamber passing the Senate-adopted health care legislation, by a vote of 219 to 212. The president signed the bill into law March 23.

Following the vote on the Senate-passed legislation, the House approved the entire reconciliation package, HR4872[8], the vehicle that combined modifications to the health care legislation as well as changes to student aid programs. This bill was approved by a vote of 220 to 211.

The reconciliation package then moved to the Senate where two amendments were adopted, which meant the package with amendments would have to return to the House for approval. The Senate voted to approve the amended reconciliation package by 56 to 43 March 24. The House gave final passage the following day.

Included in this package are measures to mandate health care coverage for all Americans and transition the student loan industry from the Federal Family Education Loan program (FFEL) to Direct Loans. Other provisions include:

Pell Grant

Maximum: Based on the assumption that the appropriated maximum grant will be at the current level of $4,860 for the foreseeable future, the maximum would increase annually from the current level of $5,550, starting in academic year 2013-2014. Following that, the annual increase would be at the rate of the Consumer Price Index. The maximum would reach its peak in 2017-2018 and level off for the remainder of the life of the legislation.

Shortfall: The legislation would allocate $13.5 billion for the shortfall in the program. The funds would be available through the end of FY12.

“Ratable Reduction:” The Education Department would no longer have the authority to “ratably reduce” the size of the award.

College Access Challenge grants

Created by the most recent higher education reauthorization bill, the program would receive $750 million over five years (FY10 to FY14). Each state would be guaranteed at least one percent of the funding.

Changes to student loan programs

The Federal Family Education Loan program (FFEL) would be terminated July 1, 2010. All new loans after that date would originate from the federal Direct Loan program.

Borrowers would be allowed to consolidate loans into this program.

“Not-for-profit servicers,” including state entities, would be allowed to service loans, if they had contracts before July 2009.

$50 million for education to provide technical assistance to institutions making the switch to Direct Loans.

Income-based repayment: Effective July 1, 2014, repayments would be capped at 10 percent of adjusted gross income (currently capped at 15 percent), and the loan’s balance would be cancelled after 20 years (currently cancelled after 25 years).

State-owned banks: State-owned banks would qualify as a government entity for the purposes of originating student loans.

Four University of Missouri students, who are part of the Big XII Leadership Organization, attended meetings with other student leaders and met with legislators in Washington, D.C. Student leaders Jordan Paul, Evan Wood, Tim Noce and Danielle Bellis encouraged delegation members to increase Pell Grants and ensure student loan access. They met with U.S. Sens. Kit Bond (R) and Claire McCaskill (D), as well as with U.S. Reps. Blaine Leutkemeyer (R) and Ike Skelton (D).

Student leaders visit Washington, D.C.

Members of MU Extension’s 4-H program also visited Washington to attend a leadership conference and express support for 4-H and its diverse activities. 4-H camp leaders and high school students Courtney Brown of Chillicothe, Jeff Durbin of Monroe City and Miki Cullifer of Moberly traveled to D.C. with Diana Duncan, interim state 4-H youth specialist, to meet with U.S. Reps. Sam Graves (R) and Leutkemeyer, and Sen. Bond. The students discussed how 4-H has helped their personal development, from raising show rabbits to winning cake decorating competitions.